Subprime mortgage securitizer C-BASS files for bankruptcy

Credit-Based Asset Servicing and Securitization, C-BASS, which purchased and serviced subprime and Alt-A mortgage loans, filed for Chapter 11 bankruptcy protection last week.
C-BASS, which reported $1 billion in debt in the filing, is owned through a joint-venture of mortgage insurers MGIC Investment Corp.(MTG) and Radian Group(RDN).
The company started with a $50 million initial investment in 1996. When subprime began to deteriorate, reaching a delinquency rate 40% in September, C-BASS began liquidating ownership, including selling Litton Loan Servicing to Goldman Sachs(GS) in 2007.
It currently is liquidating its existing portfolio and returning the proceeds to its investors, according to C-BASS.
Write toJon Prior.